Slew of BTL mortgage products hit the market as confidence grows

It's official: there is a revival in the Buy-To-Let (BTL) mortgage sector with a surge in new products and optimism among brokers improving.

The boom in BTL mortgage applications is not limited to one area; it is being enjoyed around the UK.

And more lenders are offering cheaper BTL mortgage products with smaller deposits.

Post Office announces BTL mortgage entry

The news coincides with an announcement from the Post Office which, along with its Bank of Ireland financial services partner, is entering the BTL mortgage market for the first time and is launching products with 60% and 75% LTV.

Among the new BTL mortgage products available is one from Paragon Mortgages which is introducing a new BTL product for single unit properties, HMOs and multiunit blocks where the rate is fixed at an initial 5.49% with a LTV of 75%.

The increasing number of BTL mortgage products available from a wide range of providers is also helping mortgage brokers in the sector to be upbeat about their prospects for the future.

In a survey by NatWest, 67% of intermediaries said they had seen an increase in BTL business in the last quarter of 2013 and just 4% said they saw a drop in business. Another 30% said their business had been stable in the same period.

BTL mortgage brokers upbeat for 2014 prospects

However, when questioned about the prospects for 2014, 75% of mortgage brokers said they expected to do more BTL mortgage business with just 2% saying they would do less. 25% said they would expect it to be around the same level.

Graham Felstead, of NatWest Intermediary Solutions, said: “The results of the survey are not surprising because it has been well documented that the buy to let market is recovering. There has been progress in the volume and value of BTL applications being submitted in the last two years.”

He added: “It's this optimistic outlook which matches the research we have carried out for the residential mortgage market which also showed that confidence is up significantly.”

BTL landlord repossessions falls to six-year low

Meanwhile, the Council of Mortgage Lenders (CML) has revealed that the number of landlord repossessions is now at its lowest for six years.

For the first three months of 2008, the number of repossessions in the buy to let sector were around 8,000 and this figure soared to nearly 14,000 in the first three months of 2009.

Since then, repossessions have averaged between 8,000 and 10,000 for the quarter but began to decline to 6,000 in the final quarter of 2013.

The CML says that the numbers are now falling back to pre-recession levels and, in addition, mortgage arrears are also in decline.

Paul Smee, director-general of the CML, said: “Anyone who is facing financial difficulty should talk to their lender who will endeavour to work with them in order to get them back on track to sustain long-term home ownership.”